Why each ratio is important for financial decision making


Assignment

Purpose of Assignment

The purpose of this assignment is to help students gain a better understanding of the financial statements used for corporate financial reporting and the key ratios used to make business decisions.

Assignment Steps

Select a Fortune 500 company from one of the following industries:

• Pharmaceutical
• Energy
• Retail
• Automotive
• Computer Hardware

Review the balance sheet and income statement in the company's 2015 Annual Report.

Calculate the following ratios using Microsoft Excel:

• Current Ratio
• Quick Ratio
• Debt Equity Ratio
• Inventory Turnover Ratio
• Receivables Turnover Ratio
• Total Assets Turnover Ratio
• Profit Margin (Net Margin) Ratio
• Return on Assets Ratio

Analyze in 1,050 words why each ratio is important for financial decision making.

Format your assignment according to the following formatting requirements:

1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.

2. The response also includes a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.

3. Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.

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Corporate Finance: Why each ratio is important for financial decision making
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